Building Up a Practical After-th Var Rates Schedule
Page 24
Page 25
If you've noticed an error in this article please click here to report it so we can fix it.
By Assuming Most Favourable Conditions a Hypothetical Minimum Rate Can Be Assessed Which Will Serve as a Basis on Which to Establish a Workable Schedule
(NONTINUING the discussion on a standard after-the-war rates schedule, which I commenced in my article in last week's issueigI propose to tackle the problem in the first place by endeavouring to indicate what rate would be profitable under the most favourable conditions of operation.
The conditions which must be taken into account were enumerated in the previous article, and some of the most important of them are as follow :—Size of vehicle; type of vehicle; terminal aifficulties and delays; character of goods carried, particularly the way in which they are likely to cause damage to the vehicle and thus increase maintenance costs; prospect of return loads; weekly mileage practicable; nature of terrain. Circumstances are most favourable and the lowest rate would seem to be applicable when all the factors so prevail as to have the minimum effect.
The preliminary conditions obviously imply that a 16-ton lorry must be used and it must have a body wtich is commonly described as a plain platform. It must be capable of accommodating 16-tons of pay-load without transgressing the law as regards the maximum-permitted gross laden weight of 22 tons.
A condition which is not included in the above schedule is that the load must be of such a nature that there is no need for a second man on the vehicle.
Planning a Full Day's Work.
One hour seems to be an_ irreducible period of time for loading or for unloading—that is a total of two hours per journey for these two operations—and that may be taken as applicable. The vehicle must be employed for the full 24 hours of each day and that is just possible if one driver be engaged upon it for 11 hours and then takes one hour's rest, after which a second driver takes over and continues for a similar period. Out of the 11 hours during which the vehicle is under the charge of one driver, two hours are spent in loading and unloading, leaving nine hours for actual travelling.
Assuming that maximum legal speeds are not -exceeded, we may take it that the average speed will fall a little short of 18 m.p.h., so that the maximum length of a single journey is 160 miles, and the daily mileage covered by the vehicle will be 320.
A practical difficulty seems to emerge at once. Assume that the route is between two towns, A and 13, which are 160 miles apart. Driver Jones starts out with the vehicle from A, at any time of the day or night as may be convenient. The-actual time has no effect upon the difficulty I am about to demonstrate. Assume that he starts work at 8 a.m. on Monday morning and, having loaded, gets away at 9 o'clock. He reaches B, 160 miles away, at 7 p.m., having taken one hour's rest en route, and by 8 o'clock the vehicle is unloaded and he has finished his 11-hour day. Driver Smith immediately takes over and has the vehicle loaded by 9 p.m. on Monday, leaving B and arriving at A at 7 a.m. on Tuesday. By 8 a.m, the vehicle is unloaded and he has finished his 11-hour day. The point that now arises is that Driver Jones is 160 miles away, at B, at a time when he is supposed to be ready to do another day's work.
There are two ways in which this difficulty may be overcome. One is to assume that it is possible to keep two vehicles fully engaged on this same traffic, so that there is one waiting at B for Driver Jones when his turn to drive arrives. Alternatively, we have to assume the unbelievably, advantageous circumstance that there is a place C, midway between A and B, where both drivers live and it is possible to arrange for the sequence of journeys with the one vehicle, something after this fashion.
Driver Jones picks up the vehicle at C, runs it to A during part of the night, unloads and loads it again, brings it back to C 12 hours after it has set out, and then hands it over to Driver Smith, who runs•from C to B and back whilst Driver Jones is taking his rest.
No Subsistence Allowances Payable It should be observed that; in addition to being extraordinarily convenient for our purpose in that we can run this vehicle 24 hours per day with only two drivers, there is the further advantage that no subsistance allowances are payable, because each man is at home for his period of mt. All that is needed is that there should be some arrangement whereby, at each week-end, the drivers change over duties so that the man who is on night work one week is on day work the next week.
On the whole it will, perhaps, be better for our present purpose if I assume the more practical arrangement, namely, that there are two vehicles handling this traffic and that there is sufficient of it to keep them fully loaded in both directions on every journey. That being so, all that has to be kept in mind, so far as costs are concerned, is that we have to' assume that in one week two drivers are employed, each for a period of 66 hours and each of them having to be given subsistence allowance and expenses for three nights out of the six, so that there is a total of expenses for six such nights.
' Now, the running costs of an oil-engined 16-tonner, according to " The Commercial Motor " Tables of Operating Costs, are 8.73d. per mile, made up of 2.17d. for fuel, 0.22(1. for lubricants, 1.68d. for tyres, 2.00d. for maintenance and 2.66d. for depreciation. Running for six days in a week, ,the vehicle will cover 1,920 miles and that, at 8.73d. per mile, is £69 16s. 10d. to' the nearest penny.
Standing charges per weelZ will be as follow :—Taxation, £2 4s.; wages, £12 14s. 10d.; National Health and Unemployment Insurance and insntante under the Workmen's Compensation Acts, also allowance for holidays with pay, 9s. 2d.;. subsistence allowances and expenses, £8; and rates, 12s. 6d.; insurance, El 15s.; interest on cost, £1 15s. The total is £22 10s, 6ci.
I propose to take it that the establishment costs total £10 per week for the vehicle.
Before going any farther, it is necessary to take into consiaeration the fact that this vehicle will be working for only 48 weeks in the year, that being the average experience of operators. The total of standing charges and establishment costs, namely £32 10s, 6d., must, therefore, be modified to allow for this idle period of four weeks in the year. To do that, the amount must be increased by approximately one-twelfth, which brings, it up la £35 4s. 94. Adding the running costs of £69 16s. 10d., to thisamount of fixed costs, we get a total. of £105 is. 7d. Add approximately 15 per cent. for profit, that is £15 18s. 5d., and we get a minimum of £121 per week as the revenue the • vehicle must earn for its owner.
In one week a total of 12 loads has been carried, six each way, and each weighs. 16 tons. The total tonnage is, therefore, 192 per week, and if £121 he divided by 192 we get a figure of what the rate must be to bring in that revenue; to the nearest penny it is 12s. 8d. per ton.
It should not be-but probably is-necessary, for are to point out aLonce that this is a hypothetical and not a practical rate for carrying any kind of material over a route 160 miles long. It is hypothetical because the conditions which have been assumed are not likely to be encountered. rent first When the Unit Loads are Halved Now, let us suppose that unit loads of this traffic are 8 tons and not 16 tons. This affects the first of the important factors which are scheduled above as having a bearing on rates, because, under these conditions, an 8:tonner is the largest which can be conveniently used.
After the war, it is reasonable to anticipate that 8-tonners weighing less than 3 tons unladen will be available and, therefore, legally capable of a maximum speed of 30 m.p.h. In that event, it may be taken that, whilst keeping within the legal limit, the vehicle will be able to average as much as 25 m.p.h. between the two terminals A and B, which are 160 miles apart. The actual travelling time will thus be 6.4 hours.
Furthermore, it can be assumed that the time needed to load. and unload an 8-bartner will be less than that for a 16-tonner, although, of course, nothing like in proportion to the difference in weight of load. There are certain operations connected with loading and unloading, such as checking quantities, 'signing of papers and so on, which are not affected by the load. If I take it that .8 hours is needed for loading and the same time for unloading then I have a nice easy figure of 8 hours for the complete single journey.
In the 24 hours, therefore, it will be possible to compkte-,
three single journeys or one and a half double journeys, and in six days that is nine' round trips per week. The weekly mileage will, therefore, be 2,880 and that at 6d. per mile is exactly £72 on account of running costs.
When considering the standing charges, it may again be taken that two drivers will be engaged and that each will work 66 hours per week ; the figures will then be as follow :-Licences, £1 8s. ; wages, £12 5s. ; National Health, Unemployment and Workmen's Compensation Insurances, also allowance for holidays with pay, Os.; subsistence allowances and expenses, E.3; garage rent and rates, 10s. ; insurance, £1 10s. ; interest on caPital
outlay, £/. The total of these standing charges is £20 2s. per week, to which must be added 25 on account of establishment costs,making £Z 2s. per week.
Again, as in the previous example, provision must be made for the fact that the vehicle will average only 48 weeks per year so that one-twelfth must be added to the total of fixed costs to allow for that idle period, bringing the total to £27 4. Adding the £72 for running costs we get 299 4s. as the total expenditure per week, and a profit of approximately 15 per cent, on that brings the figure for minimum revenue to £115.
In the nine double 'journeys carrying 8-tons in each direction, the total tonnage carried is 144, and to bring in a revenue of £115 it is necessary to charge 16s. per ton, compared with 12s, 8d, per ton, which is all that was found to be necessary when using a 1(1-tanner.
But someone may object; surely, when this war is over the Ministry of War Transport will have persuaded the Government, or someone' will have brought it home to the Government, that 30 m.p.h. is a safe maximum speed for heavy vehicles and, as these are presumed to be after the war rates, that condition ought to be taken into account.
Effect of Raising the m.p.h. Limit I don't know. There seems to be a feeling in 'Government circles that it would be dangerous to allow these heavy vehicles to travel at 30 m.p.h. The fact that they often travel at that rate and that accidents for this type of vehicle are comparatively rare does not appear to weigh 'very much with the authorities.
Supposing, however, that this SO m.p.h. limit does come'. about for I6-tonners, the effect will be, so far as our present problem is concerned, to raise the average speed from 18 m.p.h. to 25 m.p.h. as was assumed for the 8-tonner. In that case the 16-ton vehicle will be able to complete the same number of journeys as the 8-tonner, that is nine in a six-day week, in which case, pursuing the argument in precisely the same way as above, it can be shown that a corresponding rate per ton would be I Is. 2d., compared with 12s. 8d. when the speed limit is 20 m.p.h.
So far, nothing very new has been proved. It is almost axiomatic that a lower rate is likely to be more practicable with a 16-tonner than with an 8-tonner although, as shown in the recent brief series of articles giving actual data of loads carried, this is not invariably the truth. It may be that,. as the other conditions of operation be taken into account and as we get away from the hypothetical to the practical, we shall find reasons for modifying the conclusion that appears inevitable from the figures in this article, In concludin,g this article, and as indicating one of 'the factors which upsets these theoretical calculations, I put this problem before interested readers. What would be the rota of drivers -on a 30 m.p.h. vehicle working as above described, that is to say, covering nine complete journeys in a week of six days, it being a condition that each driver must spend alternate nights at home? S.T.R.